MIDEAST TENSIONS

MIDEAST TENSIONS; Arafat Stresses Linkage in Settling Gulf Crisis

By YOUSSEF M. IBRAHIM, Special to The New York Times

Published: November 26, 1990

TUNIS, Nov. 22—
The Palestine Liberation Organization chairman, Yasir Arafat, has said he strongly supports President Saddam Hussein's assertions that a withdrawal of Iraqi troops from Kuwait must be tied to an overall settlement of conflicts in the region, including the 40-year-old Palestinian-Israeli conflict.

Mr. Arafat, who left on one of his frequent visits to Baghdad just after being interviewed early Thursday, said that based on what he knows about the Iraqi armed forces, a war would be so devastating that it would last a long time, cause tens of thousands of casualties, and leave the region in economic and political instability.

For this reason, he said, there was no real alternative to negotiations between Mr. Hussein and those nations opposing his occupation of Kuwait.

Mr. Arafat, whose support of Iraq has been strongly denounced by Saudi Arabia, its Arab gulf allies and Egypt, dismissed predictions of a lasting and deep rupture between the P.L.O. and pro-Western Arab nations, saying the disputes would dissapear with the settlement of the crisis.

"We have had many splits before in the Arab camp," he said. "This is not the first crisis for the Arab nation, and it will not be the last." Few Regrets About U.S.

He also expressed few regrets over the effect of the crisis on the P.L.O.'s relationship with the United States, the leader of the military forces arrayed against Iraq. He noted that the United States had ended its dialogue with the P.L.O. even before the gulf crisis.

In an interview that began after midnight and lasted 90 minutes, he insisted that the resolution of the crisis could not be achieved without a simultaneous settlement of the Arab-Israeli issue, saying the two have become inextricably linked in the minds of most Arabs and in the view of many foreign governments.

"China, Japan, Germany, the European Community and even President Bush have said so," Mr. Arafat said in a reference to the Mr. Bush's assertions early in the crisis that the world must eventually address the issue of the Palestinians.

But he acknowledged that his stand has cost the Palestinians and his organization dearly. He estimated the total cost to Palestinians at $10 billion, including savings lost by about 400,000 Palestinians who lived and worked in Kuwait and the cutoff of financial aid to the P.L.O. from Saudi Arabia, Kuwait, the United Arab Emirates and Qatar, which have been angered by the P.L.O.'s support of Iraq. Principle Is Defended

Mr. Arafat said his positions were a matter of principle that could not be changed in return for "a few coins or a few petrodollars." He dismissed talk by his Arab opponents about putting pressure on the P.L.O. to remove him as a leader of the organization, saying with a faint smile that "it is our people who chose, not anyone else" and adding that some of these Arab leaders' hold on power is less sure than his own.

He argued that a war would produce such huge casualties among Arabs in Saudi Arabia, Kuwait, Iraq and elsewhere in the Middle East that it would lead to the overthrow of many an Arab government. "There is not a single Arab regime that can govern or exist over the bodies and skeletons of other Arabs," he said.

Contradicting assertions by American military officials as well as military experts in Saudi Arabia and Egypt that a war with Iraq will be quickly and decisively won by the better-armed allied forces, Mr. Arafat said Iraqi troops could withstand an assault and fight on for many months, perhaps as long as three years. He said he based that assessment on his knowledge of the Iraqi Army's armaments and ammunition, including "weapons of mass destruction,"

He placed the largest responsibility for the Iraqi invasion of Kuwait on the Kuwaiti ruling family, the Sabahs. He said that days before the invasion, he repeatedly urged the Emir of Kuwait, Sheik Jaber al-Ahmed al-Sabah, to show some flexibility toward Iraq's demands that Baghdad's $11 billion debt to Kuwait be forgiven, and toward territorial concessions along the Kuwaiti-Iraqi border. His Advice to the Kuwaitis

In a moment of self-criticism, Mr. Arafat said that in trying to persuade the Kuwaitis to compromise, he told the Emir not to become entrapped by what he described as "useless and meaningless" United Nations and Arab League resolutions against Mr. Hussein's claims.

"I told them, 'Learn from us, the Palestinians,' " Mr. Arafat said. "We have so many resolutions and decisions, but we still don't have a solution. I told them, 'Don't be fooled by resolutions and decisions. Go for the solution if there is a chance for a solution.' "

He said the P.L.O. was pursuing an eight-point settlement that it has proposed to all the nations involved in the gulf crisis. It includes a partial withdrawal of Iraqi troops from Kuwait, negotiations on a financial settlement between Iraq, Kuwait, the P.L.O. and other Arab countries affected by the crisis and the replacement of foreign troops in the region by Arab troops.

He stressed that his plan put Palestinian demands for a settlement with Israel on the same footing as the United Nations demands for an Iraqi withdrawal from Kuwait.

"One thing has to be understood clearly," he said. "We, the Palestinians, are not just a number in the equation. We are the difficult number. There can be no solution in the gulf crisis without a solution to the Palestinian problem." Always the 'Principal Issue'

He added that when it comes to the Middle East, "the Palestinian question has always been the principal issue" and that it "will remain the principal issue" after the gulf crisis.

Mr. Arafat said that given the ominous consequences of a war, there was little choice but to avoid one.

"This war will take place, however, in the most strategic and vital oil region in the world," he said. "So from the moment the first bullet is fired, there will be an economic panic. The barrel of oil will reach $100 or more. You know that oil wells and facilities on both sides will be damaged. That is in addition to the use of weapons of total destruction. And Israel, which is unquestionably a part of the plan, will be involved."

"Victory in this war will be ashes in the mouth of the victor," he said.